The enterprise considers a fluid business model essential to remain competitive in the modern marketplace — but often struggles to implement the IT backbone required for this goal.
According to a new report released by Oracle and Forbes, "Making the Change: Planning, Executing and Measuring a Successful Business Transformation," emerging players on the global platform now place pressure on businesses to seek out new ways to get ahead of the competition. Transforming a business — through bringing new products to market, deploying IT systems, or major investments and acquisitions — can take countless forms, but keeping current is proving a challenge for many companies.
The study surveyed 534 senior executives at companies with at least $1 billion in annual revenue, spanning across the Americas and EMEA region. A range of industries was included, such as professional services, banking, finance, retail and engineering.
While the majority of executives surveyed — 86 percent — said business transformation is necessary for continued success, 48 percent admitted their company was only somewhat or not at all prepared to execute a transformation today.
One in five said attempts at transformation had failed, and three in five have not yet attempted to change their business to remain competitive.
The study also found that execution of a business transformation initiative can make or break a company. The most often cited cause for failure is inefficient execution — 44 percent — followed by resource and budget constraints, cited by 35 percent of executives. In addition, the top reasons for successful transformations include support from leadership — 51 percent — and strong execution, noted by 48 percent of respondents.
However, business transformation is about more than efficiency — innovation is also a key theme. In order to stay ahead, executives said changes in client expectations, technological advances and rising competition must be considered. In order to do so, new business models must be developed, portfolios improved, and processes have to be streamlined. In total, 82 percent of executives cited the need for innovation as an important driver of the need for business transformation.
Caution and risk management also appears within the debate, and the failure to account for risk can derail transformative plans. Failure to anticipate market changes was cited by 39 percent of respondents as a threat to business transformation, while 35 percent said overall misjudgment posed a substantial threat. In addition, 30 percent pointed to the inability to evaluate and model different options or plans.
However, adoption of enterprise project portfolio management (EPPM) appears to make a difference. Executives who view their companies as leaders in transformative business are more active in leveraging EPPM processes — with 27 percent leveraging EPPM across their entire enterprise, in comparison to 13 percent of total executives surveyed.
Mike Sicilia, senior vice president and general manager of Oracle Primavera Global Business commented:
For businesses to remain ahead of an ever-changing market and meet rapidly evolving customer demands, they must effectively plan and execute transformational initiatives to create breakout growth and sustainable market leadership. EPPM solutions can help organizations address these challenges and needs simultaneously to support transformational investments on all fronts.
Read on: In the enterprise